The very high level of unit supply has flared concerns over settlement risk. Picture: Liam Kidston.MORE than 40 per cent of off the plan settlement valuations for units were coming in under contract price, new research has warned.The risk capitals where this was occurring were Brisbane, Melbourne and Perth, where unprecedented levels of unit supply in the inner city had exacerbated risks for buyers, according to CoreLogic head of research Tim Lawless.”Metadata flowing across CoreLogic valuation platforms is showing more than 40 per cent of off-the-plan settlement valuations are coming in under contract price across the Melbourne, Brisbane and Perth unit sectors,” he said. “While the large majority of these ‘under valuations’ are not showing a significant gap between the contract price and settlement valuation, more significant differences can be seen in some projects and precincts.”More from newsMould, age, not enough to stop 17 bidders fighting for this home3 hours agoBuyers ‘crazy’ not to take govt freebies, says 28-yr-old investor9 hours agoMr Lawless warned that the risk of buyers receiving a finance shock had heightened.“Buyers who receive a valuation lower than the original contract price will generally require a larger than expected deposit in order to meet the loan to valuation ratio required by the lender.”Realestate.com.au chief economist Nerida Conisbee said unit supply was at a very high level, with Brisbane seeing 10,000 come on-stream over 18 months while Melbourne was seeing 18,000 in the same period.“That, in itself, isn’t a problem,” she said. “The problem is when people start defaulting on apartments and when that becomes a bit of a flood as multiple people decide to walk away from their units.”Ms Conisbee said Brisbane was in a better position than Melbourne, given it had already turned the corner.“One of the good things for Brisbane is that the pipeline of supply coming beyond this year is pretty low so that’s good news for Brisbane. My concern is for Melbourne which continues to see more units in the pipeline, that’s a worry.”The comments come as the latest CoreLogic Home Value Index, released Wednesday, saw capital city dwelling values rise 0.7 per cent in January led by Hobart (1.4 per cent), Sydney (1 per cent), Melbourne (0.8 per cent). Brisbane saw the second lowest rise at 0.1 per cent with Darwin the only capital in negative territory (-1.7 per cent).